Watch out for your cell phones... some companies are now charging a "fee" if your cell rings more than 30 seconds without you answering it... check it out... vaaary irritatin' if you ask me!
December 28, 2002
Fees Hidden in Plain Sight, Companies Add to Bottom Line
By JENNIFER BAYOT
AT&T Wireless recently began charging for calls that go unanswered for more than 30 seconds. At many New York theaters, including the Shubert Organization's 17, ticket buyers pay a "theater restoration fee" or a "facilities fee."
Some hotels now charge a "connectivity fee" of about $4 a night for access to the phone, high-speed Internet, faxes and such, whether or not those services are actually used. They also charge $1 or more for in-room safes, whether or not the safes are used.
Companies are adding new surcharges to all kinds of services and products as they try to
compensate for a sputtering economy and price-conscious customers.
"When we charge customers a fee, it is because we have a cost that we must recover," said Mark Siegel, a spokesman for AT&T Wireless. "Our charges are all out in the open. They are fully disclosed. That's the only way to play the game."
In some cases, the new surcharges are paid only by customers who actually use specific services. They are intended to make prices fairer, because only the users must pay extra and companies can avoid raising prices across the board. For example, some Domino's and Pizza Hut franchises have been adding delivery surcharges of about 50 cents to a dollar.
In other cases, new fees apply to all customers, as a way of passing along an extra cost of doing business. Phone companies like AT&T, Sprint and Verizon added a "universal connectivity charge" this summer to finance their contribution to a federal program for people with low incomes or in rural areas.
But sometimes the fees simply create another source of revenue.
Theatergoers, who once had to complain only about the service charges added to tickets bought by phone or online, now face fees of $1.25 or $1.50 from many Broadway theaters.
Jonas Blank, a law student from Alexandria, Va., said he recently bought tickets for "Rent" at the Nederlander Theater and was surprised by the fee. "I'm not so sure it's such a bad thing," he said. "At the same time, I wonder why they don't just include that in the price. It seems a little bit like false advertising."
At hotels, some guests complain that the latest surcharges are for amenities they don't even use. They also say those fees have not translated into better service.
Last year, the Courtyard by Marriott at La Guardia Airport and the Four Points by Sheraton Hotel and Suites at Lehigh Valley Airport in Allentown, Pa., each added a "connectivity fee" of about $4 a night for access to services like phones, high-speed Internet and faxes. Meyer Jabara Hotels, which owns and operates 24 hotels, also adopted the connectivity fees.
Julie Hackett, a sales manager in San Francisco, said that during each of three stays at a Days Inn in Baltimore she was charged $1 a night for the safe in her room. "I never used the safe at that particular hotel," she said. "If I was not the type to scrutinize the itemizations of all my bills, it would have likely gone unnoticed."
Some hotels are also charging "administrative" fees for room service, on top of existing room-service charges and fixed gratuities. At the Century Plaza Hotel and Spa in Los Angeles, guests who order room service pay a $3 delivery charge, 15 percent gratuity and a 5 percent administrative fee, which would turn a $10 snack into a $15 order.
In some cases, businesses struggling to become profitable are adding charges for customers they say cost them more.
One example is the airline industry. This year, paper plane tickets have typically cost $20 more than paperless electronic tickets, and in October, two months after it filed for bankruptcy, US Airways began charging travelers $100 to fly on standby.
Since summer, the largest carriers have been enforcing long-dormant fees of $40 to $80 for checked suitcases beyond the two usually permitted, and charging for bags that weigh more than 70 pounds or exceed 62 linear inches. The fees accrue: a third bag that is simultaneously overweight and oversized might cost an extra $80, on average.
One company has gone so far as to make a game out of encouraging its employees to collect fees whenever possible. At Alaska Airlines, employees spent July and August competing for the greatest percentage increase in collecting fees for excess baggage or oversized luggage. The problem was that too many employees were waiving the fees for harried passengers. The carrier said that was not fair, that passengers were complaining about inconsistent prices.
To fix that, the company contest promised $1,000 to the winning team and individual prizes to five customer-service agents. Alaska Airlines said at the time that it wanted to raise fee collections by 25 percent, to $25 million in 2002 from $19.5 million in 2001.
Other companies are passing on the cost of processing and mailing statements and even bills. MetroPCS, which offers wireless service in a handful of cities, and Primus, the telecommunications provider, each started charging customers $2 a month this year for mailed bills. Ameritrade and TD Waterhouse last year began charging $2 for mailed trade confirmations. In April 2001, NetBank, an Internet bank that has no branches, began charging $3 for paper statements. These companies say that they need to cut billing costs to remain competitive and that their customers often prefer the paperless route after trying it.
In many cases, the latest fees signal a move toward less human interaction with customers and, many consumers complain, inferior service. Intuit, for one, is charging $14.95 for phone time with customer service representatives who handle its Turbotax software; the company says its Web site can answer all reasonable questions. Intuit could not be reached for comment. Other companies have said that a small fraction of consumers accounts for the bulk of service calls, and so those consumers should pay for those calls.
Justified or not, the newest fees can be received badly. As a result, some companies have recently withdrawn their surcharges. In October, Sprint PCS dropped its $3 charge for each call to a customer service representative.
"We listen to our customers," said Dan Wilinsky, a spokesman for Sprint PCS. "They didn't like it. They didn't want to pay it, and we waived it."
Earlier this month, American Airlines, United Airlines and Continental Airlines each said that it had canceled an impending fee to fly on standby; Delta reduced its proposed surcharge this week to $25 from $100. And this month Bank One eliminated fees to see tellers at some branches.
Edited to add spacing, I forget about the darn spacing, or I should say, lack-of double-spacing where the entire articles runs together... :-/